With this being such a critical time for the US and global economies, the US voted in Donald Trump, a candidate who was a non-politician, who represented change. Trump was elected with a platform of tax and regulatory cuts, and infrastructure spending. He also promised to “drain the swamp” and remove the corruption and lobbying that is the norm in Washington.

So Trump’s challenge was enormous enough as it was, but the fact that Trump cannot stop being Trump is making it almost impossible for him to make good on his promises. The more he shoots off his mouth and Tweets, the more he alienates his political supporters. Trump cannot implement all his promises without the approval of the Congress.

His latest scandals relate to meeting with Russians and allegations he asked FBI director Comey (now fired) to shut down an investigation into former National Security Advisor, Gen. Michael Flynn. The latter of these issues has the mainstream press all giddy with talk of impeachment.

The stock markets have not taken kindly to Trump’s latest indiscretions. Lately, the NASDAQ and S&P 500 both hit new all-time highs, but the Dow Industrial Average did not confirm. We were watching to see if the S&P 500 could have a weekly close above 2400, which would be very bullish.

With the latest Trump news, we saw volatility spike over 42% today. With the stock markets we saw the NASDAQ drop 158.63 points or 2.57%, the S&P 500 down 43.64 points or 1.82%, and the Dow down 372.82 points or 1.78%.

The problem for the markets is that with all these distractions the odds of getting any tax reform before the summer break is in serious decline.

Keep an eye on the 2325 level (top dotted line) level for the S&P 500, as it represents the Near-term Support and a break below that level brings 2300 into sight. A break below 2300 would open the door for a significant correction. A 7% correction would take the S&P 500 to 2238 (lower horizontal line).

At this point the April monthly close could prove to be significant. While the Dow did not confirm with a new high, if we get all three indexes with a May monthly close below the April close, then we could see a prolonged correction here.

A prolonged correction here would set up for a very welcome buying opportunity. Our model’s projection for a global debt crisis remains on target, meaning that ultimately we will see massively indebted countries default on their debt, and the global flow of capital will seek out safer private investments such as North American equities.

As the masses realize that it is governments that are the problem, investors will dump government bonds and buy equities and gold. A serious stock market correction here would set up very well with our model’s projection of one final rush out of equities into bonds, and then we see Europe start to collapse, and the first of many Sovereign Debt Defaults.

Timing is the key. If you understand the global flow of capital, you will not only survive this coming global Sovereign Debt Crisis, you will be in position to prosper significantly. If you don’t, you won’t!